Groundnut prices won’t come down despite sluggish China demand

By: |
March 10, 2020 4:00 AM

Against the estimated crop of 32 lakh MT during the current season, Gujarat farmers witnessed around 28-30 lakh MT, of which nearly 70% has been consumed.

Ground prices are currently around Rs 950-Rs 1,180 per 20 kg in different APMCs of Gujarat. Ground prices are currently around Rs 950-Rs 1,180 per 20 kg in different APMCs of Gujarat.

Despite sluggish demand for groundnut seeds and oil from coronavirus-hit China, prices of groundnuts would remain unaffected, as nearly 70% of the total production has either been consumed or processed into oil or seeds.

Against the estimated crop of 32 lakh MT during the current season, Gujarat farmers witnessed around 28-30 lakh MT, of which nearly 70% has been consumed. The remaining groundnut stock is in the possession of National Agriculture Cooperative Marketing Federation of India (Nafed), oil millers, traders and farmers.

Over six lakh MT is in the possession of Nafed alone and only a small quantity is with farmers as of today, Saurashtra Oil Mill Association president Samir Shah said. “There has been adequate demand for groundnut oil from the domestic market. Some quantity of groundnut oil and groundnut seeds is still being exported to China. Moreover, there has been less cultivation of groundnut in Sudan and Senegal, which would also help Indian exporters explore other markets,” Shah added.

Nafed has started selling old groundnuts (procured during last season), Niraj Adhia, a leading broker of peanuts, said, adding that if Nafed would start selling new groundnuts in bulk, there would be some adverse impact on prices. But it would first try to empty the old stock and then start selling new groundnuts. As result, prices wouldn’t get reduced, he added.

Ground prices are currently around Rs 950-Rs 1,180 per 20 kg in different APMCs of Gujarat. A week ago, prices were hovering around Rs 850-Rs 1,000 per 20 kg. However, sources said the recent drop in crude prices and other factors may impact the commodity in the range of nearly 20% on both upper and lower sides. Even in the case of groundnut seeds, prices have increased by Rs 8 in the last one week to Rs 81 per kg, Adhia said.

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